Military land leasing for fees has long served as a critical slush fund for the CCP’s military in 2016 the CCP issued a complete ban on the military’s commercial activities including land leasing which had a widespread impact on various businesses, one such case is that of Chu Judi, a Shenzhen merchant with a market in Xiaoguan, Guangdong situated on Military leased land who exposed the corruption and exploitation by the military during the market’s closure. Xiaoguan market comprising over a 100 businesses rented idle military land and properties. Chu who had close ties with the market owner stated the military’s rented properties and land acted as a slush fund. Instead of being handed over to the state or used for military expenses, these funds were embezzled by military leaders.
The CCP central military commission’s March 2016 directive aimed to end all paid military services within 3 years including real estate leasing part of the plan’s second phase.Chu mentioned that the halt of paid military services corruption, a move referred to as military commercial decoupling, intended to sever their corruption chain, their market lease was set to expire in 2023.Due to necessary Market Reforms, the owner faced difficulties unexpired contracts let do a decoupling agreement with the armed police transferring management to Rongtong companywhich sent rents directly to the state treasury. The armed police realized they would lose their income source after this takeover ending their rent collection and corruption opportunities, they aim to profit one last time before the markets transition Chu added, the military’s corruption is extremely severe marked by blatant buying and selling of official positions. It’s known that China’s Rongtong company is a massive state owned enterprise established by the CCP in July 2019, it’s also known as the largest Central Enterprise in terms of assets, second only to the China Railways Corporation.
China Rongtong company is responsible for handling all the operational assets and properties including farms handed over by the CCP’s military from across the country, the creation of this real estate Behemoth for the military by the CCP garnered significant attention, especially during a period when Central Enterprises were being directed to withdraw from the real estate sector, armed police officers demanded bribes of nearly 42000 US dollars.
Chu outlined a two-step reform and decoupling process at Guangdong Xiaoguanmarket. Initially market operators signed a decoupling agreement with the armed police force. The second step involved entering into a new lease agreement with China Rongtong after the decoupling. However, Chu revealed that the local military obstructed further progress after providing the market owner with the decoupling agreement which the owner signed despite being prepared to sign a lease with Rongtong company. The owner was neither allowed to sign nor to meet with the company, this obstacle emerged because a military officer handling the case demanded a 300,000 yuan, approx.. 41945 US dollar to proceed with the full contract given the owners already strained finances they refused to pay. A shocking incidents took place in the marked ones where local troops brutally suppressed the markets traders likening the scene to a war movie from the anti-Japanese war with ordinary people forcibly ousted. The market was home to small vendors all of whom were forcefully evicted, the market owner was also expelled, he highlighted that the evicted tenants who had contracts with the market owner sought compensation for their losses resulting in the owner’s multi-million dollar investment disappearing overnight.
A complex issue with significant interests: Putting an end to the paid services provided by the military is a sensitive matter for the Chinese Communist Party as it involves substantial interests the controversy surrounding the closure of Chu Judi’s market merely scratches the surface of the deeper issue. Reports suggest there is resistance to discontinuing the military’s paid services in a report by Xinhua news agency, a Chinese state-owned media outlet, it was announced on May 31st 2017 that the military’s commercial activities were slated to conclude by June 2018. However, on June 11th 2018, the central military commission issued a joint notice extending the deadline to December 2018, effectively postponing it by six months. Hua Po, a current affairs observer in Beijing offered an analysis stating the ban on the military engaging in paid services has adversely affected the interests of certain individuals who have incurred significant losses. Another expert on Chinese issues Heng He noted that the military’s largest and longest running paid services are related to hospitals. Hospitals are entangled in two aspects: one involves charging significant fees for external services, and the other pertains to the issue of organ harvesting from Falun Gong practitioners.
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